Most Australians feel forced into renting, new poll finds

Affordable housing is a high priority for Australians, third at 46 per cent behind energy costs at 70 per cent of respondents and terrorism and security at 48 per cent, and 75 per cent said that housing affordability has had an impact on their lives in some way.

Mortgage holders also said they were feeling impacted, with 48 per cent saying they have to cut back on other expenses to afford their mortgage, and 50 per cent said mortgage repayments are impacting on their budget.

As housing affordability prevents more people buying houses, renters are one of the biggest groups being affected, with only 4 per cent of renters seeing renting as a choice, which imply the other 96 per cent feel renting is the only option available to them. Further, 50 per cent see home ownership as unavailable, and renting being a long-term solution.

Rents are also viewed as putting pressure on tenant’s wallets, with 55 per cent cutting back on other expenses to afford their rent, and 70 per cent saying their rent is putting pressure on their overall budget.

Millennials are among the biggest groups said to be impacted, with 82 per cent feeling effected by housing affordability issues, in comparison to 69 per cent of Generation X and 47 per cent of Baby Boomers.

The major factor affecting housing prices was thought to be foreign investors with 60 per cent of respondents believing so, followed by over-population increasing demand and investors taking on board negative gearing.

Yet despite the high prices, only 15 per cent believe housing affordability will lead to a crash, while 37 expect the market to stabilise and 43 per cent see prices rising in the future. A large number of mortgage holders feel they would be hurt by falling prices at 40 per cent, while 56 per cent said they would benefit.

In order to address housing affordability, 56 per cent of respondents said the government should reduce stamp duty, 48 per cent said the government should provide first home buyer grants and 43 per cent said they should put in place measures to keep interest rates low.

Next was limiting the gains investors would make through negative gearing at 38 per cent. However Dr McKenzie, co-founder and director of strategy of the Australian Futures Project, said there should be more investing to solve the housing affordability issue, not less.

“They’re a part of the solution as well as the setting at the moment might be part of the problem, but I don’t think we would want investors to disappear,” Dr McKenzie explained.

In order to address the issue at hand, Dr McKenzie said more education is needed on all sides of the spectrum – potential property owner and government.

“I think there’s more that can be done to ensure that people have a good understanding of the current policy,” she said.

Even with a sound understanding of the current policy, there is still work that needs to be done, according to Dr McKenzie, such as first home buyer grants.

“First home buyer grants, in some cases, I think there have been, there [are] so many constraints in how they’re implemented, but often, they’re not fit for purpose for a lot of people,” she said.

“For example, in NSW, it’s for people building new homes, or under a certain cost, most of which won’t apply in some of the most expensive markets, so first home buyers are not going to be able to build a new home in the centre of Sydney, you know, there [are] things like that.

“The whole point of WTF [Australia] and the whole reason we chose this topic is we think it’s a really good chance to help break down some of the [misunderstandings], misconceptions, but also strengthen the conversation between decision makers and the public.”

For investors who have questions about housing affordability, WTF Australia has a number of experts answering questions about housing affordability, and are accepting questions sent via email at [email protected], Facebook, Twitter, or SMS at 0488 805 605. More details are available on the WTF Australia website until 23 October, 5PM.

And if investors think they have an idea to start fixing the housing affordability crisis, WTF Australia is also accepting ideas through the WTF Australia website, with a prize of $500 for the idea of the week and is offering a grant between $5,000 to $25,000 through an organisation to help see that idea through.

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